The hottest trade of the year so far isn’t AI. It’s tanker stocks

“The run‑up in tanker stocks relates to expanding tonne miles,” said Chris Robertson, Deutsche Bank’s director of LNG infrastructure and maritime shipping. “Simply put, oil and fuel travel farther on less efficient routes. When ships occupy tighter windows, demand exceeds capacity. Robertson linked the upside to three geopolitical shocks. The most recent is the Strait of Hormuz blockade—a critical chokepoint for crude and refined product traffic. Others include sanctions on Russian crude following the Ukraine invasion and Houthi missile strikes targeting Red Sea vessels.” Together, these tensions stretch the entire supply chain and erode efficiency, Robertson noted.
Tanker earnings hinge on freight rates—the fees carried by ship for moving oil. Rates climb when routes lengthen or security threats arise. Persistent conflict drives insurers to impose higher premiums, leaving shipowners cautious about operating in high‑risk zones. “As long as the threat of attack persists, rates stay robust,” Robertson added. “He also highlighted balance‑sheet strength among public tanker firms: many have slashed debt, freeing cash for dividends and buybacks. International Seaways reported that 85% of its net income was returned to shareholders for a third straight quarter, per its August 10 earnings release. Even though spot rates approach a peak, Robertson expects shipping costs to remain elevated until regional turmoil eases, because operators will continue to demand a premium for entry into volatile markets.”

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